Israel is making the transition from a collectivist, mobilized garrison state to a more open, pluralistic, consumer-oriented and democratic country, according to Frankel, former Jerusalem bureau chief for the Washington Post (and now its London correspondent). This superb, gripping piece of reportage is a pivotal account of a new Israel struggling to be born. Frankel views the Palestinian intifada-which shattered Israel's status quo, forcing Yitzhak Shamir's government into a halfhearted peace proposal that almost caused his downfall-as the opening step in the process of change. Among the other catalytic forces he identifies are the slow crumbling of Israel's centralized socialist-oriented economic establishment; the arrival of a half-million Soviet Jewish refugees, which exposed weaknesses in Israel's housing and education sectors and job market; and the rise of the ultra-religious yet populist Shas Party, which preaches reconciliation between hawks and doves. Interviews with Shamir, Russian Jewish activist Natan Sharansky, Israeli army general Amram Mitzna, who was in charge of suppressing the Palestinian uprising, and with Palestinian activists and Israelis of diverse political views flesh out this chronicle. Author tour. (Nov.)